Bone Biologics Corporation — FY2023 Form 10-K
Reporting period: Year ended December 31, 2023; filed February 21, 2024. This is an annual report, not a standalone fourth-quarter report. Bone Biologics is a development-stage medical-device company focused on NELL-1 combined with demineralized bone matrix (DBM) for spinal fusion. It has not generated revenue.
Key financial metrics
| Metric | 2023 | 2022 |
|---|---|---|
| Revenue | $0 | $0 |
| Research and development expense | $6.91 million | $1.58 million |
| General and administrative expense | $2.52 million | $2.09 million |
| Total operating expenses | $9.43 million | $3.67 million |
| Net loss | $8.95 million | $1.48 million |
| Net cash used in operating activities | $9.56 million | $3.57 million |
| Cash at year-end | $3.03 million | $7.54 million |
At December 31, 2023, total assets were $3.74 million, current liabilities were $831,402, and stockholders’ equity was $2.91 million. Liabilities included $360,662 of accounts payable and accrued expenses, a $414,989 accrued settlement, and a $55,751 warrant liability. The balance sheet shows no debt line; the filing text does not provide a clear amount of borrowings. Margins are not meaningful because the company had no revenue. Basic and diluted loss per share was $34.01, compared with $31.15 in 2022; share and per-share figures were retrospectively adjusted for reverse stock splits.
Material changes versus 2022
- Operating expenses rose 157%, primarily because R&D spending increased 337% to prepare and manufacture NELL-1 clinical material for the pilot study.
- Net loss increased to $8.95 million from $1.48 million, while operating cash use increased to $9.56 million from $3.57 million.
- Cash declined by $4.51 million to $3.03 million despite $5.04 million in net financing proceeds during 2023. The company raised approximately $4.45 million net in its June offering and $592,000 net in its November offering.
- The warrant-liability remeasurement generated $892,693 of income in 2023, down from $2.91 million in 2022; this noncash item partially offset the operating loss.
- The company effected 1-for-30 and 1-for-8 reverse stock splits in June and December 2023, respectively.
Business progress, outlook, and risks
- The first-in-human, multicenter randomized pilot study in Australia commenced near year-end 2023. It is planned for 30 patients; endpoints include fusion success at 12 months and change in Oswestry Disability Index pain score. The company expects the trial to finish 12 months after the 30th patient is enrolled, but gives no specific enrollment-completion date.
- The company intends to use Australian pilot data to support a larger U.S. pivotal study and ultimately submit a premarket approval application (PMA). FDA guidance indicates NELL-1/DBM is a combination product requiring PMA approval before U.S. commercialization. No FDA approval or commercial launch is assured.
- Management estimates operating expenditures of $5.5 million over the next 12 months and says year-end cash was expected to fund operations through the second quarter of 2024. It estimates approximately $5 million to complete first-in-human studies and a further $24 million in scientific expenses to pursue FDA approval. Estimates are subject to change.
- The company reported approximately $80.9 million in accumulated losses. Management and the independent auditor stated that recurring losses and operating cash use raise substantial doubt about the company’s ability to continue as a going concern. Additional financing is needed; its availability and terms are uncertain, and equity financing could dilute shareholders. The financial statements include no going-concern adjustments.
- Clinical, regulatory, manufacturing, and commercialization risks are substantial. The company relies on third parties, including MTF, and has only two full-time employees. Its nine licensed UCLA patents are expected to expire between 2024 and 2033; the company also has license diligence obligations and potential milestone, royalty, and liquidity-event payments.
- A lawsuit settlement was agreed in January 2024 for $750,000. The company accrued and paid $414,989, with its insurer paying $335,011; dismissal with prejudice was expected but was not yet reported as completed in the filing.
- Nasdaq notified the company of a minimum-bid-price deficiency in September 2023. The company regained compliance on January 9, 2024, but remained subject to a Nasdaq discretionary panel monitor through June 28, 2024.
- The auditor issued an unmodified opinion on the financial statements, with a going-concern emphasis. Management concluded disclosure controls and internal control over financial reporting were effective; the auditor did not attest to internal-control effectiveness.
Important facts for investors to verify
- Current cash, monthly burn, and financing availability relative to the stated Q2 2024 runway and estimated $5.5 million operating needs.
- Australian trial enrollment pace, safety findings, and whether the 30-patient study can support the planned U.S. pivotal trial.
- Potential dilution from warrants and options. The filing reports 197,844 warrants outstanding at year-end and 534,238 common shares outstanding; review exercise terms and subsequent share-count changes.
- Whether the settlement action has been formally dismissed, and whether any additional legal or indemnification costs remain.
- Nasdaq listing status after the discretionary monitoring period and the timing and terms of any subsequent financing.
- Patent coverage and license diligence deadlines, particularly given the disclosed 2024–2033 patent expiration range.
- Reconcile the filing’s share-count disclosures: it reports 534,238 shares outstanding as of February 14, 2024, while one market-section sentence also contains an apparently inconsistent figure of 11,038.